Procurement Glossary
Variant management: definition & important aspects for buyers
The professional management of product variants enables companies to find the right balance between customer individuality and economic complexity. This structured overview shows how Procurement can reduce costs and increase competitiveness at the same time through systematic variant management.
Variant management in a nutshell:
Variant management is the systematic planning, control and optimization of product diversity along the entire value chain. For Procurement , this makes it possible to reduce the variety of parts, bundle requirements and simplify supplier relationships, which leads to considerable cost savings.
Example: By standardizing door handles, a car manufacturer reduces the number of variants from 24 to 8 basic types, which leads to a 22% reduction in procurement costs and reduces the number of suppliers from 6 to 2.
Introduction to variant management
Variant management is a strategic approach to the systematic planning, management and control of product diversity in companies. At a time when customers are increasingly demanding individualized products, companies are faced with the challenge of finding an optimal balance between variant diversity and economic efficiency. Variant management aims to master the complexity of product development, production and logistics while maximizing customer benefits. In this guide, you will learn about the most important principles, methods and tools of variant management as well as its significance for modern corporate management.
What is variant management?
Variant management refers to the systematic planning, control and optimization of the variety of products or services within a company. The aim is to find a balance between fulfilling individual customer requirements and mastering internal complexity. Effective variant management enables companies to strategically design their product range, reduce costs and strengthen their market position.
Core elements of variant management
Significance for Procurement
In Procurement , variant management has a significant influence on procurement strategies and cost structures. By reducing the variety of parts, purchasing volumes can be bundled and better conditions can be achieved with suppliers. It also enables greater standardization of materials and components, which leads to simplified processes and lower stock levels.
Variant management: from individual production to mass customization
Building on the theoretical foundation of variant management, the immense importance of efficient control of product diversity is evident in practice. Companies are faced with the challenge of meeting individual customer requirements without driving up complexity and costs. The need for a transformation from traditional approaches to modern methods is becoming increasingly clear in order to remain competitive and optimize internal processes at the same time.
Old: Individual production
Traditional approach:
In traditional individual production, products are manufactured exactly according to the specific requirements of each customer. Although this enables a high level of customer satisfaction, it leads to considerable challenges in practice. Without standardized processes, lead times are long and production costs increase due to low quantities and a lack of economies of scale. Warehousing is also complex, as specific components have to be kept in stock for each variant. Supply chains become confusing and the quality assurance agreement is made more difficult because each variant has unique characteristics.
New: Mass customization
Mass customization:
The modern approach to variant management relies on mass customization, i.e. the combination of mass production and individual adaptation. By using modular building block systems and standardized components, companies can offer a large number of product variants without significantly increasing complexity. Digital technologies such as product configurators and flexible manufacturing systems make it possible to serve customers individually and still benefit from the advantages of standardization. This leads to shorter delivery times, lower costs and higher quality, as proven components are used. Supply chains are made more efficient and transparency in variant management is increased through the use of data management systems.
Practical example: Automotive industry
A leading car manufacturer implemented a modular platform concept to produce different models on a common basis. By standardizing up to 60% of the components, production costs were reduced by 15%. At the same time, customer satisfaction increased as individual equipment variants could be freely selected via configurators. The changeover time between different models on the same production line was reduced by 30%, which significantly increased the flexibility and efficiency of production.
Conclusion on variant management
Variant management is an essential tool for modern companies to reduce complexity and optimize costs. Through systematic standardization and intelligent modularization, companies can increase their competitiveness and meet customer needs at the same time. Success lies in the balance between variant diversity and operational efficiency, with Procurement playing a key role in strategic implementation. Future-oriented technologies such as AI and predictive analytics will continue to revolutionize variant management and open up new potential for optimization.
